RICHMOND -- Dogged for two months by calls for her ouster since an independent investigation revealed she misused city resources, Human Resources Director Leslie Knight will resign effective July 1, City Manager Bill Lindsay announced Friday.

"Her remaining work with the city will be in the form of assisting during this personnel transition and the transition to a new fiscal year," Lindsay wrote in an email to top city officials late Friday.

The announcement comes after weeks of building outcry stemming from an early March investigation report revealing that Knight improperly received at least $400 monthly in a car allowance while also using a city vehicle, used paid city staff to make trinkets and ordered a subordinate to access a whistle-blower's emails after she lodged a complaint against Knight.

The report followed months of investigation by Sacramento-based Van Dermyden Allison Law firm, which looked into a 59-page complaint lodged last year by Stacie Plummer, 43, the finance manager for the Library & Cultural Services Department. Many of the allegations, including that Knight used city resources to profit from her trinket business, were found untrue. The trinkets Knight used city resources to package and store were given as gifts to city employees, according to a summary of the report provided by Lindsay.

But the misuse of some resources, including thousands from collecting a car allowance while also using a city car, outraged union officials and residents who demanded Knight be dismissed.

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Lindsay, who brought Knight to the city in 2005 from Contra Costa County, where she was human resources director, consistently resisted calls to fire Knight. Lindsay said he calculated that Knight improperly took $10,800 in auto allowances.

"She paid the city $10,800," Lindsay wrote in an email Monday. "She does not owe the city any additional restitution."

But for reasons still unclear, Knight opted to resign. She could not be reached for comment.

Lindsay said Monday that Lisa Stephenson, currently the labor relations manager in the Human Resources Department, will assume management responsibilities for that department. "I do not have any current plans to hire anyone to fill Leslie's vacant position," he wrote in an email.

Knight's critics welcomed news of her resignation.

"I'm hoping Ms. Knight's resignation will help deter further wrongdoing, workplace bullying, harassment and retaliation that has become pervasive as part of the culture of the city," Plummer wrote in an email Saturday. "Unfortunately, her resignation does not address her debt owed to the taxpayers from her sustained transgressions. Does this send a message to city employees that abuse of authority that appears to lead to embezzlement and misappropriation of public resources ends in a comfy retirement?"

In response to an email Friday asking for the terms of Knight's retirement, Lindsay wrote, "There are no financial terms except what would go to any other employee (payout of vacation leave, etc.). I do not know what her pension is."

The city has refused to release the full investigation report, citing attorney-client privilege. Lindsay released a two-page summary in March, saying the investigation rejected allegations that Knight "spied" on Plummer with surveillance equipment, and found that she did not abuse her power or retaliate, harass or treat subordinates unequally. This newspaper's attorneys challenged the city's refusal, and the city's attorneys have promised to release some additional documents by Thursday¿.

Mayor Gayle McLaughlin and Councilwoman Jovanka Beckles, both of whom had expressed concerns with Lindsay's earlier decision not to fire or demote Knight, said the resignation was a step toward restoring a sense of fairness to the city.

"It was the integrity of the city that was at stake," McLaughlin said. "I'm glad closure is happening, and hope that lessons learned are taken to heart."

Beckles said, "City staff who are responsible for enforcing the rules need to be without even the slightest appearance of violating those rules."

In his internal city note on Friday, Lindsay praised Knight for her service to the city and provided a list of accomplishments.

"During the recent recession," Lindsay wrote, "Leslie helped steer a path that provided for fiscal responsibility, virtually all of which was accomplished without the devastating layoffs that happened in Richmond during 2003 and 2004.... Leslie's strategies helped steer the City organization in this direction."

Lindsay also noted that Knight in 2010 received the John H. Nail Memorial Award, which the League of California Cities gives annually to an outstanding municipal assistant.

It is unknown whether the Contra Costa County District Attorney's Office is investigating the matter, which Plummer has requested.

Knight's base salary in 2011 was $220,000, with a total compensation of $281,507, according to this newspaper's public employee salary database.